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100% profitable method - tight SL, and large TP

  • #21
  • Edited 11:59am May 25, 2010 11:48am | Edited 11:59am
price action is price action. price is all you need. my charts are naked as in price line only. indicators?? who cares what banks are using on their charts, are you a bank trader or a retail trader? there is a big difference.

smaller moves are easier to predict, less risk in the sense that your not exposing your account to this crazy market for long at all, you know if you're right or wrong right away with minimum risk, and profit is quicker and larger. You have no idea where price is going to go, all you can know is your risk, TP's make no sense. Hence, I scalp forex. I would never waste my time with longer time frames (4h-daily/weekly) unless I was rich and wanted to invest... though it wouldn't be in the forex market.

but to each their own.. happy trading to all.
  • #22
  • May 25, 2010 12:00pm May 25, 2010 12:00pm
Quoting Monroe
price action is price action. price is all you need. my charts are naked as in price line only. indicators?? who cares what banks are using on their charts, are you a bank trader or a retail trader? there is a big difference.


but to each their own.. happy trading to all.
Indeed. Anyway, I'd just be lost without a MA.
  • #23
  • May 25, 2010 12:03pm May 25, 2010 12:03pm
I see nothing wrong with MA's to help determine market sentiment (especially on longer TF's) and to help you see possible setups. I just think (IMO) that using them as signals for entry based on crosses, or as S/R is not smart... and all entries should be confirmed by PA 100%. Therefor, price is really all you need. Everything else just lags price.
  • #24
  • Edited May 26, 2010 9:12am May 25, 2010 12:10pm | Edited May 26, 2010 9:12am
Quoting Adal
95% of traders lose. 95% of the advice you'll get on this forum is from losers. The good advice will not be what the majority thinks it's good advice. For example, the majority "advice" is to have a positive risk-reward ratio (TP > SL). Maybe that's not actually what you need to do. Think about this
A 5%er has already told how it is; I'll give it a shot anyway.

Several r:r variables exist, including

  1. Automated entry/exit levels (TP,SL) expressed as % p/l per trade [You noted this one.] Include with this, P/L ultimately reached from automated entry/exit levels over an equal number of profit and loss trades. ^
  2. a host of chart/news/orderflow reasons, each weighted for worth and then added to the rest of the reasons
  3. psychological reasons, from typical reaction to what is traded (a big run, a sideways market, etc.), to gut feeling about the trade's potential, to nontrading issues one brings to the job.


^ TP:SL is useless to predict a trade's r:r without considering how often one loses or profits over time, given all other stuff constant. In a), % P:L replaces TP:SL for making this r:r calculation; b) calculates the P:L needed for the # of trades won : lost of 1:1 and for a variety of %'s each P or L.

a) using % P/L instead of pips for TP, SL --
( ( (# pips of TP or of SL)/ 10000) / pair's entry price ) * leverage, if original investment is in the pair's denominator's currency (in USD, of GBP/USD)

b) r:r over time of an equal number of TP trades and SL trades --
examples: One loss, 50%, then one profit, 100%, is 2:1 rr each trade and 1:1 rr over time, since 1 - 1*50%=.5 -> .5 + (.5*100%) = 1; one loss, 1%, then one profit, 2%, is 2:1 rr each trade and 1.5:1 rr over time, since 1 - 1*1% = .99 -> .99 + (.99*2%) = 1.01

  • #25
  • Edited 3:37pm May 25, 2010 3:18pm | Edited 3:37pm
Quoting woo
Well because im an expert scalper: ......
I dont want to sound arrogant, but i think what makes me good is because im putting so much mental effort, philosozing,thinking, ive done it for 7 years.
Thanks, you've made me feel better, and I'm NOT being facetious. I'm still experimenting and asking questions after almost 4 years; now I've found somebody who's doing it after 7 years. So I'm not necessarily an idiot, for not having my method finalized by now.

IMO, your questions are very valid. I am still trying very hard to improve my own exits.

In my experience, it's very difficult to gain any kind of edge from exits. Look at the number of threads on exits compared to entries. If there was a clear-cut, 'one-approach-fits-all-situations' way of profiting from exits, it would be more apparent, and probably more frequently discussed.

If there is an obtainable edge, it has to be along the lines of (1) scaling out at points of higher probability reversal, and (2) exiting more quickly if the market appears to be ranging, and conversely, allowing more to ride in strongly trending situations.

Initial SL is a delicate compromise between not letting losses get too big, and allowing enough room so that not too many would-have-been winning trades get cut down prematurely (of course we can always re-enter, but at the cost of the spread). In a market that moves near-randomly, this is likewise not going to be clear-cut.

Inverting what the "95%" do is not necessarily a way of making it into the "5%". It's like saying if I buy when my method tells me to sell, and vice versa, then I'll turn a losing system into a winning one. It just doesn't work that way. "Near-randomness-plus-spread" is a significant barrier to overcome. Another possible angle is the fact that, although the market 'trends' so obviously in hindsight, it's almost impossible to accurately pick tops and bottoms in real time, hence the best that one can safely hope for is to capture a 'chunk' out of each move. Even if we invert our entry and/or exit method, we're still going to leave some pips behind at both ends of the trade. So the question becomes: does the market move far enough, often enough, to provide a margin of error capable of overcoming our personal level of inaccuracy?
  • #26
  • May 25, 2010 3:23pm May 25, 2010 3:23pm
Quoting FX-Petra
But it will save young traders a lot of money and give them a decent shot to be profitable after 6 months.
Great to hear that you've found some light at the tunnel end!

I have likewise found greater consistency in the trends on the longer TFs. And of course, if one is trading larger moves, the spread becomes less significant, %-wise.
  • #27
  • May 25, 2010 4:17pm May 25, 2010 4:17pm
woow man!

excellent

you trade for 7 years! and your blog said you are 23 years old

so you are trading from 16 !! and those 7 are your experience years! so when you begin practicing for your career? from 10 or what?

wow, you must be born on the floor and came out without crying,

just yelling buy @ MRKT Yo MF
  • #28
  • May 25, 2010 4:17pm May 25, 2010 4:17pm
Quoting Pollux
Indeed. Anyway, I'd just be lost without a MA.
MA is not an indicator, tis a derivative of price, doesn't 'indicate' nothin...sorta makes your post previous to the above kinda lost if you were attempting to say you never see a bank without MAs on their chart...which is still a naked chart in most people's books..

Saying an MA is an indicator is like saying renko is an indicator
  • #29
  • May 25, 2010 7:26pm May 25, 2010 7:26pm
^^ Couldnt you say that of any "indicator"? They're all essentially MAs of one sort or another. If we all dropped the term indicator and called them price filters or something it would be more appropriate IMO.
  • #30
  • May 25, 2010 7:51pm May 25, 2010 7:51pm
Quoting Sim
MA is not an indicator, tis a derivative of price, doesn't 'indicate' nothin...sorta makes your post previous to the above kinda lost if you were attempting to say you never see a bank without MAs on their chart...which is still a naked chart in most people's books..

Saying an MA is an indicator is like saying renko is an indicator
Whatever you use as a reference can be called your indicator.
(MA or even candle stick formation or price action....)
as long that is what you refer to for entry signal/exit signal..just how you call it

either it is simple or complicated!
  • #31
  • May 25, 2010 8:05pm May 25, 2010 8:05pm
Quoting woo
.....
The reason why i think this could work out, is because, the market trends a lot ofter than ranging. .....
Do you notice market move 70 to 80% in ranging? Trending/Breakout is about 10 to 20%.

I think your idea is quite similar to 7Bit idea of reverse martingale.
Not sure what is his final/recent conclusion...
If 7Bit read this post, pls help to comment..
  • #32
  • May 25, 2010 10:31pm May 25, 2010 10:31pm
Quoting akukaya
Do you notice market move 70 to 80% in ranging? Trending/Breakout is about 10 to 20%.
Can you please identify the criteria used to determine these numbers for ranging and trending?
  • #33
  • Edited May 26, 2010 6:40am May 25, 2010 10:33pm | Edited May 26, 2010 6:40am
Quoting Sim
MA is not an indicator, tis a derivative of price, doesn't 'indicate' nothin...sorta makes your post previous to the above kinda lost if you were attempting to say you never see a bank without MAs on their chart...which is still a naked chart in most people's books..

Saying an MA is an indicator is like saying renko is an indicator
No, from what I've been seeing on this forum, saying to people which affirm they are trading naked that you have a moving average plotted on the chart you are almost instantly becoming part of the 95% traders that fail. I only have one ema (sometimes I may add one) and I don't use it for entries or exits, just for getting a clue about the current trend. And as long as it indicates me that, for me it's an indicator. But does it matter, anyway?
  • #34
  • May 26, 2010 12:31am May 26, 2010 12:31am
Quoting zznbrm
Can you please identify the criteria used to determine these numbers for ranging and trending?
I think it is easy to identify after it occurs. Although anyone may define differrent criteria but basic u can google :

market trending: something like higher high, lower low...
market breakout: real breakout, price dont come back..(type of trending)

other than that: market ranging..can be small ranging or slight big ranging(including swing)

You may use any trend indicator in mt4 to help roughly estimate.
  • #35
  • May 26, 2010 6:34am May 26, 2010 6:34am
Woo:

http://www.forexfactory.com/showthread.php?t=236827
  • #36
  • May 26, 2010 7:53am May 26, 2010 7:53am
Quoting akukaya
I think it is easy to identify after it occurs. Although anyone may define differrent criteria but basic u can google :

market trending: something like higher high, lower low...
market breakout: real breakout, price dont come back..(type of trending)

other than that: market ranging..can be small ranging or slight big ranging(including swing)

You may use any trend indicator in mt4 to help roughly estimate.
I'm not interested in how I can determine if the market is ranging/trending. I'm interested in how you came up with these numbers.

You said market is ranging 70-80% and trending 10-20%. Was there a scientific method used to determine these numbers, or are they just another rough estimate from looking at charts?
  • #37
  • May 26, 2010 8:02am May 26, 2010 8:02am
Quoting Pollux
No, from what I've been seeing on this forum, saying to people which affirm they are trading naked that you have a moving average plotted on the chart you are almost instantly becoming part of the 95% traders that fail. I only have one ema (sometimes I may add one) and I don't use it for entries or exits, just for getting a clue about the current trend. And as long as it indicates me that, for me it's an indicator. But does it matter, anyway?
Nope I agree with you there 100%... but where did the assumption of instantly becoming in the 95% of traders that fail if you plot an MA on your chart come from?
  • #38
  • May 26, 2010 8:07am May 26, 2010 8:07am
Quoting Ted1983
^^ Couldnt you say that of any "indicator"? They're all essentially MAs of one sort or another. If we all dropped the term indicator and called them price filters or something it would be more appropriate IMO.
Yep agreed,, but MAs are as much of an 'indicator' as price itself is. You have a 1sma which is close price itself, you have a 2sma, average of last two closes...it's not indicating any form of signal or forecast of price.

From there, if it is manipulated into other things... overbought/oversold,, buy/sell signals, then we are getting into 'indicator' territory, as they are objectively indicating things which price itself would not be, and if it was, it would be totally subjective.

This is the distinction and why they are called indicators.. they are our best efforts of getting objective signals outta the market..
  • #39
  • May 26, 2010 8:10am May 26, 2010 8:10am
Quoting akukaya
Whatever you use as a reference can be called your indicator.
(MA or even candle stick formation or price action....)
as long that is what you refer to for entry signal/exit signal..just how you call it

either it is simple or complicated!
True hehe... I deem it simple as you say yourself but the above post shows the logical distinction as to why indicators are called just that, indicators... whereas people referring to naked trading refer to price action, MAs, trendlines, fibs.. the term naked has been misinterpretted here so was tryin to clear it up.
  • #40
  • May 26, 2010 9:12am May 26, 2010 9:12am
Quoting woo
here is my journal (where i use a compeltely different method, only based on PA)

www.cashfxspot.blogspot.com/
You see, when I hear "expert" the likes of John Paulson, Warren Buffet, Soros... etc come to mind, with years of verifiable experience.

Your blog only has 1 post on it from 3 months ago... anything more recent to to validate this self given "expert" title?

Anyone can have a lucky streak which is what it looks like in your case. Unless of course you are too busy raking it in to update your blog.

just curious...
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